Souter's retirement would give President Barack Obama his first opportunity to appoint a member of the Supreme Court. Obama has suggested he would be interested in adding another woman to the court, and that he may be interested in choosing someone who has not been a judge.

Souter, 69, who was appointed by President George H. W. Bush in 1990, tends to vote with the liberal-leaning wing of the nine-member Supreme Court, where 5-4 decisions on controversial topics are commonplace. A departure by Souter and replacement with a like-minded Obama appointee would be unlikely to tip the balance of the court.

The Supreme Court is scheduled to complete its term in June. Nomination and confirmation hearings could go on during the summer in preparation for the court reconvening for a new term in October.

While Souter has tended to be late to hire clerks, sometimes as late as early summer, the rumors of a possible retirement this year have been particularly strong because sources told ABC News they have yet to see evidence that he had even interviewed candidates for the jobs.

Earlier this spring, Souter met with Sen. Patrick Leahy, D-Vt., the chairman of the Senate Judiciary Committee, for a private lunch at the court. Leahy staffers would not describe the content of that meeting.

Souter reportedly has been telling friends for some time that he did not like living in Washington, D.C., and intended to return to his native New Hampshire.

Nominated by Republican; Voted With More Liberal Bloc

Souter was born in Massachusetts, but spent most of his life in the rural town of Weare, N.H. He attended Harvard College, Harvard Law School and was a Rhodes scholar. He spent much of his law career in public service -- notably as an attorney general in New Hampshire and later on the state's Supreme Court.

When Bush nominated Souter for the U.S. Supreme Court bench, he was considered a candidate unlikely to cause the kind of political firestorm that Robert Bork's confirmation hearing had. Little was known about Souter's positions on issues.

However, despite being nominated by a Republican, Souter has been a more liberal justice than many initially expected.

ABC News' Jan Crawford Greenburg and George Stephanopoulos contributed to this report.